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Subsidized Housing, Emergency Shelters, and Homelessness: An Empirical Investigation Using Data from the 1990 Census

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  • Edgar O. Olsen

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  • Dirk W. Early

    ()

Abstract

This paper uses data on the only systematic count of the homeless throughout the United States to estimate the effect on the rate of homelessness of a wide variety of potentially important determinants, including several major policy responses to homelessness that have not been included in previous studies. It improves upon estimates of the effect of previously studied determinants by using measures that correspond more closely to underlying theoretical constructs, especially by accounting for geographical price differences. It also conducts numerous sensitivity analyses and analyzes the consequences of the undercount of the homeless for point estimates and hypothesis tests. The paper's most important finding from a policy perspective is that targeting the current budget authority for housing assistance on the poorest eligible households will essentially eliminate homelessness among those who apply for assistance. Achieving this goal without concentrating the poorest households in housing projects and without spending more money requires vouchering out project-based assistance. The primary methodological finding of the paper is that the 1990 Decennial Census did not produce sufficiently accurate counts, especially of the street homeless, to permit very precise estimates of the effects of many factors which surely affect the rate of homelessness. The main exceptions are the price of housing and average March temperature. Plausible models of the undercount imply that in regressions with a rate of homelessness as the dependent variable estimators of the coefficients of explanatory variables will be biased towards zero. In regressions with the logarithm of a rate of homelessness as the dependent variable, only the estimator of the constant term will be biased downwards. The unknown magnitude of the undercount precludes predicting the effects of policy interventions on the number of homeless based on the results in this paper and previous studies.

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File URL: http://www.virginia.edu/economics/RePEc/vir/virpap/papers/virpap352.pdf
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Bibliographic Info

Paper provided by University of Virginia, Department of Economics in its series Virginia Economics Online Papers with number 352.

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Length: 47 pages
Date of creation: Jul 2001
Date of revision:
Handle: RePEc:vir:virpap:352

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Web page: http://www.virginia.edu/economics/home.html

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Keywords: Homelessness;

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References

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  1. Honig, Marjorie & Filer, Randall K, 1993. "Causes of Intercity Variation in Homelessness," American Economic Review, American Economic Association, vol. 83(1), pages 248-55, March.
  2. John M. Quigley, 1990. "Does rent control cause homelessness? taking the claim seriously," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 9(1), pages 89-93.
  3. Cragg, Michael & O'Flaherty, Brendan, 1999. "Do Homeless Shelter Conditions Determine Shelter Population? The Case of the Dinkins Deluge," Journal of Urban Economics, Elsevier, vol. 46(3), pages 377-415, November.
  4. Grimes, Paul W. & Chressanthis, George A., 1997. "Assessing the Effect of Rent Control on Homelessness," Journal of Urban Economics, Elsevier, vol. 41(1), pages 23-37, January.
  5. Troutman, William Harris & Jackson, John D & Ekelund, Robert B, Jr, 1999. " Public Policy, Perverse Incentives, and the Homeless Problem," Public Choice, Springer, vol. 98(1-2), pages 195-212, January.
  6. Stephen Malpezzi & Gregory H. Chun & Richard K. Green, 1998. "New Place-to-Place Housing Price Indexes for U.S. Metropolitan Areas, and Their Determinants," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 26(2), pages 235-274.
  7. Edgar O. Olsen, 2000. "The Cost-Effectiveness of Alternative Methods of Delivering Housing Subsidies," Virginia Economics Online Papers 351, University of Virginia, Department of Economics.
  8. Allgood, Sam & Moore, Myra L. & Warren, Ronald Jr., 1997. "The Duration of Sheltered Homelessness in a Small City," Journal of Housing Economics, Elsevier, vol. 6(1), pages 60-80, March.
  9. John M. Quigley & Steven Raphael & Eugene Smolensky, 2001. "Homeless In America, Homeless In California," The Review of Economics and Statistics, MIT Press, vol. 83(1), pages 37-51, February.
  10. Early, Dirk W. & Olsen, Edgar O., 1998. "Rent control and homelessness," Regional Science and Urban Economics, Elsevier, vol. 28(6), pages 797-816, November.
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Cited by:
  1. O'Flaherty, Brendan & Wu, Ting, 2006. "Fewer subsidized exits and a recession: How New York City's family homeless shelter population became immense," Journal of Housing Economics, Elsevier, vol. 15(2), pages 99-125, June.
  2. Early, Dirk W., 2004. "The determinants of homelessness and the targeting of housing assistance," Journal of Urban Economics, Elsevier, vol. 55(1), pages 195-214, January.
  3. O’Flaherty, Brendan, 2012. "Individual homelessness: Entries, exits, and policy," Journal of Housing Economics, Elsevier, vol. 21(2), pages 77-100.
  4. Early, Dirk W., 2005. "An empirical investigation of the determinants of street homelessness," Journal of Housing Economics, Elsevier, vol. 14(1), pages 27-47, March.
  5. Sinai, Todd & Waldfogel, Joel, 2005. "Do low-income housing subsidies increase the occupied housing stock?," Journal of Public Economics, Elsevier, vol. 89(11-12), pages 2137-2164, December.
  6. O'Flaherty, Brendan, 2004. "Wrong person and wrong place: for homelessness, the conjunction is what matters," Journal of Housing Economics, Elsevier, vol. 13(1), pages 1-15, March.

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